The owner of Bunnings, Officeworks, Target and Kmart have Wesfarmers posted an 18.2 per cent surge in full-year sales to $43.55 billion.
Key was the performance of Bunnings and the Kmart Group.
At Bunnings revenues were up 4.4% to $18.5 Billion, earnings only grew 1.2% to $2.2M.
Officeworks delivered $3.3 billion in revenue up 5.9% over the prior year, profits were up 10.5% to $200 million.
Kmart Group, which also includes discount retailer Target delivered revenues of $10.635 billion, up 16.5 per cent.
The variety retailing Group also delivered profits of $769 million up 52.3 per cent a record for the business.
Same-store sales at Kmart jumped 14.5 per cent, which was a major reversal on the prior year when same store sales fell at Target.Wesfarmers boss Rob Scott said the group’s largest divisions performed particularly well during the year. Mr Scott said the results demonstrate the strength of the group’s operating model and the quality of the portfolio.
Bunnings
- Bunnings management said that Bunnings’ solid sales and earnings demonstrate the resilience of demand across its offer and continued strong execution of its strategic agenda.
- Sales growth was recorded in both consumer and commercial customer segments and across all trading regions, despite the impact of prolonged wet weather on spring trading on the east coast during the first half.
- Bunnings’ total store sales growth was 2.1 per cent for the second half, with strong demand and activity from commercial customers partially offset by lower consumer sales.
- Robust consumer demand continued for necessity products that support recurring home repairs and maintenance, and smaller scale DIY home improvement projects.
- Compared to the prior corresponding half, consumers demonstrated more caution in making big-ticket purchases and commencing larger DIY projects.Bunnings continued to advance its ‘Whole of Build’ strategy, with improvements to the sales and service model enabling customers to shop more efficiently. Tool Kit Depot expanded into Queensland and Victoria, and Bunnings continued to expand its Frame & Truss network, creating more opportunities to connect with builders early in a project.
Officeworks
- Officeworks’ revenue increased 5.9 per cent for the year to $3,357 million. Earnings of $200 million were 10.5 per cent higher than the prior year.
- Officeworks’ sales growth reflected improved Back to School trading, significant growth in business-to-business (B2B) sales and continued above-market growth in technology categories. Sales also benefitted from increased demand across stationery, art, office supplies and Print & Create, as foot traffic to stores continued to normalise following the impacts of COVID-19 in the prior period.
- Officeworks’ strong earnings growth was supported by higher sales and the realisation of benefits from recent investments to drive productivity and efficiency across the business.
- Officeworks continued to invest to modernise its supply chain during the year, including completing the transition to a new Victorian Import Distribution Centre (IDC) and progressing the development of a new Customer Fulfilment Centre (CFC) in WA.
Kmart Group
- Kmart Group management claimed that the latest financial results reflect strong underlying trading performance and strong execution of pricing strategies and operational plans during the period, as well as the normalisation of trading conditions following the significant COVID-19 restrictions in the first half of the prior year.
- Sales results for Kmart reflected growth across all categories, as well as increases in both units sold and transaction volumes on the prior year.
- Pleasing sales growth continued in the second half as customers responded positively to Kmart’s lowest price positioning and good product availability. Target’s trading performance was in line with the prior year, but second half performance was variable across categories, with relatively stronger performance in apparel compared with challenging trading conditions in home and toys.
- Kmart continued to enhance its omnichannel customer experience, digitise its operations and drive additional efficiency benefits, including through the rollout of radio frequency identification (RFID) technology across all Australian Kmart stores, which was completed during the year.
